Elevance Health's (ELV) Q2 Earnings Beat on Lower Benefit Expense

Core Viewpoint - Elevance Health, Inc. reported strong second-quarter 2024 adjusted earnings of $10.12 per share, exceeding expectations and showing a 12% year-over-year improvement [1] Financial Performance - The quarterly results were driven by increased product revenues in the CarelonRx business and a significant rise in net investment income, although these gains were partially offset by declines in Medicaid and Medicare membership and reduced premium revenues [2] - Medical membership stood at approximately 45.8 million, a 5% decrease year over year, missing consensus estimates [3] - Total expenses were $40.9 billion, a slight decline of 0.8% year over year, but higher than estimates [4] - Operating gain remained flat at $2.1 billion, below consensus expectations, while the operating margin improved by 20 basis points to 5.8% [5] Segmental Results - Operating revenues for the segment reached $13.3 billion, a 10% year-over-year increase, driven by new services and the Paragon Healthcare acquisition [6] - The Carelon unit reported an operating gain of $705 million, an 8% increase year over year, although it was below consensus estimates [16] Financial Position - As of June 30, 2024, long-term debt was $24.6 billion, up 5.7% from the end of 2023, with short-term borrowings at $225 million [8] - Cash and cash equivalents were $6.5 billion, a slight decrease from the end of 2023, while total assets increased to $113 billion [18] - Total equity rose to $42.3 billion, reflecting a 7.3% increase from the end of 2023 [19] Capital Deployment - The company paid a quarterly dividend of $1.63 per share, totaling $378 million [9] - Share buybacks amounted to $462 million in the second quarter, with a remaining capacity of approximately $3.2 billion [20] Outlook - Adjusted earnings are projected to be at least $37.20 per share for 2024, indicating a 12% improvement from 2023 [21] - Operating revenues are expected to show flat to low single-digit growth, with medical enrollment forecasted between 45.8 and 46.6 million [22]